Economic Policies & Ideologies

Pearling dominated the Qatari economy up until the modern period, as it did the economies of all the coastal Gulf polities. Of the pearling beds in the Gulf, the most concentrated encircled Qatar’s northern coast and nearly all Qataris were in one way or another associated with the trade.[1] Pearling echoes in today’s Qatar, incorporated into architectural motifs and monuments, remembered in heritage displays and in museum exhibits.

Pearls are dependent on foreign demand; by the late 19th century pearls had become hugely popular in western nations and had nearly supplanted Bombay as a destination for Gulf pearls. When the Japanese released cultured Mikimoto pearls in the 1920s, the Gulf pearl trade began to collapse. The local economy was further impacted by the sudden drop in western demand during the Great Depression in the 1930s, and was entirely devastated during World War II with the complete cessation of the pearl trade.[2]

While oil exploration was fully underway during this period, it wasn’t until 1949 that the first shipment of oil left Qatar, and significant benefits to society didn’t take place until the 1960s. The years leading up to the oil boom are thus remembered as the “Years of Hunger.” The loss of the pearling industry devastated the merchant class and, as was typical of regional tribes, the poor subsistence base triggered migration, both of which were factors which empowered the al-Thani family by weakening voices that might have made alternate claims to power or placed limits on their authority. Oil wealth facilitated the growth of patronage networks that have benefited the al-Thanis and other powerful tribal families, thereby encouraging the growth of politically dependent social groups who support al-Thani leadership and have little interest in democracy.[3]

Like pearls, the oil and gas economy are at the mercy of global demand. As a result, Qatar’s economy is managed carefully and conservatively, though this hasn’t always protected them from dipping into deficit. The Qatar Ministry of Finance plans ahead to the year 2020, when oil reserves are projected to be depleted, and underscores the need for energy independence and a diversified economy. Qatar has invested heavily in international real estate and stock portfolios which are anticipated to soften the blow when oil and gas are no longer reliable sources of revenue.[4]

This vulnerability is also a result of Qatar’s workforce; foreign labor dominates private and public sector employment, and, combined with the highest levels of global per capita income and a lavish welfare system, analysts fear that there is little incentive for native Qataris to devote time and energy into developing the native workforce.[5] Increased investment in Qatar University, Education City and other education initiatives are a clear response to the need for a well-educated workforce capable of withstanding the loss of hydrocarbon production. However, most native Qatari students pursue humanities and Islamic studies, neither of which are highly employable fields.

One of the most striking features of Qatar’s economy is its enormous foreign labor force, the majority of which are South Asian men, who are ubiquitous among the endless construction sites across the nation. Men far outnumber women in Qatar, making up roughly 70% of the population (77% of all non-Qataris), primarily because migrant laborers are unmarried and those who are married cannot afford to support a family in Doha on low wages.[6] Qatar has a poor track record of upholding its labor laws, abuse of migrant laborers is widespread, and many are victims of human trafficking.[7] Unskilled foreign workers arrive in Qatar under the oversight of a Qatari sponsor, what is known as the kafala system. Sponsors sometimes confiscate laborers’ passports, and may demand high sums to “pay” for the cost of bringing them into the country. Workers have complained that they receive little to no time off, live in squalid conditions, are barred from unionizing, and some find that their wages are withheld for months on end. Change to the kafala system has been slow, in large part because cheap labor has undergirded Qatar’s massive urban development. However, these issues have become particularly salient in light of the 2022 FIFA World Cup, which has intensified scrutiny of Qatar’s labor issues. Human rights organizations such as Amnesty International and the United Nations have called on the Qatari government to make significant improvements to labor regulations, and to enshrine these in Qatari law.[8]